Dollar eases in Asia on renewed financial fears
Wednesday, 16 July 2008
TOKYO, July 15 (AFP): The dollar dipped in Asian trade today as worries about the health of the US financial sector grew despite steps by Washington to try to ease pressure on mortgage giants, dealers said.
They said a decision by Japan's central bank to leave its benchmark interest rate on hold at 0.5 per cent, as expected, had a muted impact.
The dollar slipped to 105.82 yen in Tokyo afternoon trade from 106.18 in New York late Monday. The euro firmed to 1.5940 dollars from 1.5909 but declined to 168.67 yen from 168.93.
The dollar was pressured by "mounting worries over the health of the US financial system," said Kenichi Yumoto, vice president of forex sales at Societe Generale.
Market sentiment soured despite a US government plan announced Sunday to give bigger credit lines for Fannie Mae and Freddie Mac, which offer vital support to the multitrillion- dollar US mortgage market.
"Markets have digested this move more as a sign that the financial sector has worsened so much" that it needs help, said Yumoto.
They said a decision by Japan's central bank to leave its benchmark interest rate on hold at 0.5 per cent, as expected, had a muted impact.
The dollar slipped to 105.82 yen in Tokyo afternoon trade from 106.18 in New York late Monday. The euro firmed to 1.5940 dollars from 1.5909 but declined to 168.67 yen from 168.93.
The dollar was pressured by "mounting worries over the health of the US financial system," said Kenichi Yumoto, vice president of forex sales at Societe Generale.
Market sentiment soured despite a US government plan announced Sunday to give bigger credit lines for Fannie Mae and Freddie Mac, which offer vital support to the multitrillion- dollar US mortgage market.
"Markets have digested this move more as a sign that the financial sector has worsened so much" that it needs help, said Yumoto.